Insurance - Betterments/Improvements

Betterments, as they are referred to in the Alberta Condominium Act, or Fixture Improvements, as they are referred to in the BC Strata Property Act, are one of the least understood and most problematic insurance issues for a condominium or strata. Where bylaws clearly indicate that the corporation is not responsible for these items there is less concern. However even for older buildings where the bylaws state that fixtures built or installed by the owner developer as part of the original construction are to be applied there can still be a problem if the units have had numerous refurbishing cycles and/or original finishes that are no longer readily available.

The corporation should make every attempt to insure each unit owner understands what is and what is not their responsibility in this matter. Unit owners should be cognizant of what the insurance appraisal benchmark interior finishes are in order to clearly understand for what they are responsible. An example would be if the insurance report stated that the benchmark was carpet flooring and the owner had hardwood, then the unit owner clearly has a betterment or improvement.

In dealing with this issue the question that the Corporation should ask is: "Are the insurance report, the Corporation's bylaws, The Condominium or Strata Act, and the insurance policy consistent?" If not, it is important to reconcile these variances.

What can Reliance do to help this process for our clients? Betterments or Fixture Improvements can include such items as upgraded flooring, kitchen and bathroom plumbing, cabinetry, and fixtures, and inclusion of fireplace and/or skylights, as examples. Our firm provides the option of extensive unit-by-unit inspection and documentation of upgrades over common benchmark components, or the unit owners can complete a form provided by Reliance, which can be incorporated into the insurance policy by the board or council and easily updated on an ongoing basis. When filling out this checklist we also provide our clients with instructions and answers to aid the completion of the form.